The total consideration payable on completion of the acquisitions is ~A$12.0 million1 .
Overview
The new business acquisitions relate to:
– Brunswick Valley Funerals, which has provided funeral and related services in and around Mullumbimby, NSW for over 18 years;
– Gladstone Valley Funerals, which has provided funeral and related services in and around Gladstone, QLD for over 25 years;
– Osbornes Funeral Directors2 , which has provided funeral and related services in and around Rotorua, NZ for over 40 years; and
– Decra, which has supplied headstones and monuments in NZ for over 40 years.
Together, the businesses:
– generated ~A$6.0 million of revenue in their last financial year3 ;
– conducted ~350 funerals in their last financial year3 ; and
– operate from five locations (over multiple titles), of which Propel will:
• acquire two of the properties on settlement; and
• lease three of the properties, with options to acquire two of those properties.
Consideration
The total consideration payable on completion of the acquisitions is ~A$12.0 million1 , comprising: – A$11.5 million1 in cash; and – A$0.5 million1 via the issue of 84,534 Propel ordinary shares4 on completion of the relevant acquisition.
In addition, up to A$1.5 million1 in cash will be payable if certain financial milestones are achieved during the three years following completion of the relevant acquisitions.
The cash required to complete the acquisitions will be funded from the Company’s debt facilities, following which Propel’s estimated available funding capacity is expected to be ~A$155 million.
Expected Timing Subject to satisfaction (or waiver) of customary conditions (e.g. due diligence, third party lessor consent, consent to assignment of key contracts, etc.), the above acquisitions are expected to be:
– completed during Q4 FY24 and Q1 FY25; and
– earnings accretive in year one.
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i hold PFP ( bought in December 2020 @ $3.00 )
